Silver (XAG) Forecast: Market Eyes Support at $37.87 in Cautious Silver Outlook

Silver Stabilizes as Traders Defend Key Support at $37.87

Silver prices edged higher Tuesday as traders focused on holding a critical support level at $37.87. The market is showing signs of base-building, not breakout strength, with buyers working to prevent a retest of the 50-day moving average at $37.40. A failure there could open the door to the July 31 low at $36.21.

For now, the $37.87 level is doing its job. Until that base is lost or cleared with conviction, price action remains range-bound, and momentum trading stays limited.

At 12:55 GMT, XAG/USD is trading $38.07, up $0.05 or +0.13%.

Gold and Silver Benefit from Weaker Dollar, Flat Yields

Silver is trading in step with gold, both supported by a slight drop in the U.S. dollar index (-0.1%) and steady bond yields. The 10-year Treasury sits at 4.324%, while the 2-year ticked down to 3.761%. These conditions reduce the opportunity cost of holding metals and are helping both contracts hold near recent levels.

Gold remains below its 50-day average at $3349.70 and the key pivot at $3353.58, making it a mirror for silver’s indecision. Until buyers push through technical ceilings, both metals will likely chop inside recent ranges.

Jackson Hole and Fed Minutes Are the Key Risk Events

This week’s focus is squarely on the Federal Reserve. The release of July meeting minutes and Chair Jerome Powell’s Jackson Hole speech are expected to shape rate cut expectations for September. The CME FedWatch tool shows an 83% probability of a 25-basis-point cut, a scenario that would be supportive for silver if confirmed by Powell’s remarks.

Traders are holding back from directional bets until this event risk clears. Strong confirmation of policy easing could drive metals higher and potentially force a re-test of upper resistance.

Geopolitical Support Still Secondary

News of former President Trump engaging both Zelenskiy and Putin in separate meetings adds a geopolitical undertone, but there’s no strong move in safe-haven demand yet. Without policy clarity or escalation, silver remains tied to rate expectations and dollar direction.

Outlook: Silver Holding the Line, But Buyers Need a Signal

Traders are defending $37.87, building a floor rather than targeting a breakout. A move under $37.40 would expose downside to $36.21. On the upside, confirmation from Powell could push silver toward $38.74, but that resistance isn’t in play until buyers clear current hurdles. The bias leans cautiously higher, but follow-through depends on the Fed.

More Information in our Economic Calendar.